In his speech to the Conservative conference in October 2015, the Chancellor, George Osborne, announced that by 2020 councils in England will be able to keep 100% of the proceeds from business rates raised in their area. Under the current system councils keep 50% and rest goes to central government.
This will be the biggest change to business rates in 25 years
In addition, the Uniform Business Rate (UBR), which currently applies to the whole of England will be abolished. Councils will be able to set their own “Rate in the Pound” which means that the occupier of a property with a Rateable Value of 50,000 in one area, might not pay the same amount of business rates as the occupier of a property with the same Rateable Value in a different area.
Under the proposal local authorities will be able to charge lower business rates but they won’t be able charge higher business rates (higher than what is not yet clear). The exception to this is where there is a directly elected mayor the authority will be able to increase the rate by up to 2p in the pound to finance infrastructure, but only if businesses vote in favour of the increase.
A lot can happen between now and 2020, and there will still be a rating revaluation in 2017, but whatever happens, business rates will continue to be one of the highest outgoings for any business.
For help and advice on reducing your business rates please contact us